Rising Female Labour Force Participation and the Distribution of Family Income—the Swedish Experience

Abstract

This paper analyses how rising labour force participation of marned women in Sweden during the 1970s affected the distribution of family income. We use the squared coefficient of variation and compare the dispersion of family (factor) income with the dispersion of marned men's income We find an equalizing effect of wives' income, in the sense that family income is more equal than husbands' income. Furthermore, the equalizing effect of female income was stronger in 1980 than in 1967, i.e. when female labour force participation had increased markedly. An examination of hours of work and determinants of wage rates suggests that the equalizing effects stem from wage rates rather than from hours of work. This effect holds in spite of very strong positive correlation between husbands' and wives' education.